Joint Committee - Bundesverband der Deutschen Volksbanken und Raiffeisenbanken (BVR), for the cooperative banks, the Bundesverband Öffentlicher Banken Deutschlands (VÖB),for the public-sector banks, the Deutscher Sparkassen- undGiroverband (DSGV), for the savings banks finance group, and the Verband deutscher Pfandbriefbanken (vdp), for the Pfandbrief banks
The principle of proportionality should be taken into consideration when determining the recapitalization amount. The idea of Article 3 paragraph 2 is appropriate – a recapitalization amount could even be set at zero. Furthermore, if the resolution authority comes to the conclusion, that there is no public interest in a resolution of the institution (see EBA/CP/2014/16), this result should be taken into account not only for determining the recapitalization amount but also for determining the MREL. If the resolution authority in general concludes, that there is no public interest for a resolution, a determination of the MREL above “0” or at the most amounting to a symbolic character would not be justifiable.
According to Article 7(2) draft RTS the resolution authority has a wide area of discretion when determining the MREL for G-SIIs and O-SIIs. In our opinion, this discretion should not be allowed for G-SIIs, as possible crisis situation would harm an institution of that size in a considerable manner and a solution of such crisis would typically not be solved without using means of the resolution fund. All in all we agree with the proposal, that the MREL should be determined individually and in consideration of the bank specific resolution plans.